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Restructuring

3 Months Ended

12 Months Ended

Mar. 31, 2011

Dec. 31, 2010

Note 12—Restructuring

As part of our ongoing effort to implement our strategy of reducing operating costs, we have evaluated our workforce and operations and made adjustments, including headcount reductions and business process reengineering resulting in optimized work flow at rental locations and maintenance facilities as well as streamlined our back-office operations and evaluated potential outsourcing opportunities. When we made adjustments to our workforce and operations, we incurred incremental expenses that delay the benefit of a more efficient workforce and operating structure, but we believe that increased operating efficiency and reduced costs associated with the operation of our business are important to our long-term competitiveness.

During 2007 through 2010, we announced several initiatives to improve our competitiveness and industry leadership through targeted job reductions. These initiatives included, but were not limited to, job reductions at our corporate headquarters and back-office operations in the U.S. and Europe. As part of our re-engineering optimization we outsourced selected functions globally. In addition, we streamlined operations and reduced costs by initiating the closure of targeted car rental locations and equipment rental branches throughout the world. The largest of these closures occurred in 2008 which resulted in closures of approximately 250 off-airport locations and 22 branches in our U.S. equipment rental business. These initiatives impacted approximately 8,500 employees.

During the first quarter of 2011, we continued to streamline operations and reduce costs with the closure of several car rental and equipment rental locations globally as well as a reduction in our workforce by approximately 100 employees.

From January 1, 2007 through March 31, 2011, we incurred $479.0 million ($240.7 million for our car rental segment, $184.9 million for our equipment rental segment and $53.4 million of other) of restructuring charges.

Additional efficiency and cost saving initiatives are being developed during 2011. In April 2011, we closed eleven equipment rental locations and expect to close an additional one or two locations in the remainder of the second quarter of 2011. We estimate that these equipment rental location closures will result in $20 to $30 million of restructuring charges in the second quarter of 2011.

Restructuring charges in our consolidated statement of operations can be summarized as follows (in millions of dollars):

			Three Months ended March 31,

			2011		2010
By Type:
	Involuntary termination benefits		$	1.0	$	3.4
	Pension and post retirement expense			—		0.3
	Consultant costs			0.1		0.5
	Asset writedowns			0.7		0.7
	Facility closure and lease obligation costs			3.1		3.6
	Relocation costs			—		1.3
	Other			—		0.9

		Total	$	4.9	$	10.7

			Three Months ended March 31,

			2011		2010
By Caption:
	Direct operating		$	4.3	$	7.0
	Selling, general and administrative			0.6		3.7

		Total	$	4.9	$	10.7

			Three Months ended March 31,

			2011		2010
By Segment:
	Car rental		$	1.0	$	5.3
	Equipment rental			3.9		4.9
	Other reconciling items			—		0.5

		Total	$	4.9	$	10.7

The following table sets forth the activity affecting the restructuring accrual during the three months ended March 31, 2011 (in millions of dollars). We expect to pay the remaining restructuring obligations relating to involuntary termination benefits over the next twelve months. The remainder of the restructuring accrual relates to future lease obligations which will be paid over the remaining term of the applicable leases.

		Involuntary Termination Benefits			Pension and Post Retirement Expense		Consultant Costs			Other			Total

Balance as of January 1, 2011		$	6.3		$	0.2	$	0.1		$	10.9		$	17.5
	Charges incurred		1.0			—		0.1			3.8			4.9
	Cash payments		(3.4	)		—		(0.1	)		(0.4	)		(3.9	)
	Other⁽¹⁾		0.2			0.1		—			(2.5	)		(2.2	)

Balance as of March 31, 2011		$	4.1		$	0.3	$	0.1		$	11.8		$	16.3

(1): Consists of decreases of ($0.7) million for asset writedowns and ($1.9) million for facility closures, partly offset by an increase of $0.4 million due to foreign currency translation.

Note 12—Restructuring

Additional efficiency and cost saving initiatives are being developed in 2011. However, we presently do not have firm plans or estimates of any related expenses.

Restructuring charges in our consolidated statement of operations can be summarized as follows (in millions of dollars):

			Years ended December 31,

By Type:			2010		2009		2008
	Involuntary termination benefits		$	12.2	$	44.1	$	83.8
	Pension and post retirement expense			0.4		0.7		5.6
	Consultant costs			1.1		7.6		10.0
	Asset writedowns			20.4		36.1		93.2
	Facility closure and lease obligation costs			14.3		9.3		14.1
	Relocation costs			5.0		4.1		—
	Contract termination costs			—		1.7		—
	Other			1.3		3.2		9.5

		Total	$	54.7	$	106.8	$	216.2

			Years ended December 31,

By Caption:			2010		2009		2008
	Direct operating		$	43.5	$	65.4	$	171.6
	Selling, general and administrative			11.2		41.4		44.6

		Total	$	54.7	$	106.8	$	216.2

			Years ended December 31,

By Segment:			2010		2009		2008
	Car rental		$	18.1	$	58.7	$	98.4
	Equipment rental			34.7		38.2		103.2
	Other reconciling items			1.9		9.9		14.6

		Total	$	54.7	$	106.8	$	216.2

The following table sets forth the activity affecting the accrual during the years ended December 31, 2010 and 2009 (in millions of dollars). We expect to pay the remaining restructuring obligations relating to involuntary termination benefits over the next twelve months. The remainder of the restructuring accrual relates to future lease obligations which will be paid over the remaining term of the applicable leases.

		Involuntary Termination Benefits			Pension and Post Retirement Expense			Consultant Costs			Other			Total

Balance as of January 1, 2009		$	43.4		$	0.5		$	—		$	16.4		$	60.3
	Charges incurred		44.1			0.7			7.6			54.4			106.8
	Cash payments		(67.3	)		—			(6.9	)		(25.1	)		(99.3	)
	Other⁽¹⁾		(0.6	)		(1.2	)		(0.3	)		(36.0	)		(38.1	)

Balance as of December 31, 2009			19.6			—			0.4			9.7			29.7
	Charges incurred		12.2			0.4			1.1			41.0			54.7
	Cash payments		(23.5	)		—			(1.5	)		(12.4	)		(37.4	)
	Other⁽²⁾		(2.0	)		(0.2	)		0.1			(27.4	)		(29.5	)

Balance as of December 31, 2010		$	6.3		$	0.2		$	0.1		$	10.9		$	17.5

(1): Primarily consists of a decrease of $36.1 million for asset writedowns, $1.6 million for executive pension liability settlements and $0.8 million for contract termination costs, partly offset by a $0.2 million gain in foreign currency translation.
(2): Consists of decreases of $20.4 million for asset writedowns, $6.5 million for facility closures, $1.6 million loss in foreign currency translation, $0.9 million in involuntary benefits and $0.2 million for executive pension liability settlements, partly offset by an increase in consultant costs of $0.1 million.